The following figure shows the marginal cost [MC],average cost [AC],marginal revenue [MR],and demand curves for a profit-maximizing monopolist.
Figure 11-2
-Refer to Figure 11-2.If the government wishes to regulate the monopoly firm by setting the price at OB in the market,the monopolist will:
A)produce the efficient quantity of output.
B)have to shut down to cut losses.
C)continue to earn economic profits.
D)earn a higher profit.

Question

The following figure shows the marginal cost [MC],average cost [AC],marginal revenue [MR],and demand curves for a profit-maximizing monopolist.
Figure 11-2 
-Refer to Figure 11-2.If the government wishes to regulate the monopoly firm by setting the price at OB in the market,the monopolist will:
A)produce the efficient quantity of output. 
B)have to shut down to cut losses. 
C)continue to earn economic profits. 
D)earn a higher profit.

Quizplus · Accepted Answer

The Answer of The following figure shows the marginal cost [MC],average cost [AC],marginal revenue [MR],and demand curves for a profit-maximizing monopolist.
Figure 11-2 
-Refer to Figure 11-2.If the government wishes to regulate the monopoly firm by setting the price at OB in the market,the monopolist will:
A)produce the efficient quantity of output. 
B)have to shut down to cut losses. 
C)continue to earn economic profits. 
D)earn a higher profit.

The Following Figure Shows the Marginal Cost [MC],average Cost [AC],marginal